This morning saw durable goods orders rise a better-than-expected 3.6% in May, while home prices jumped 2.5% in April, according to the S&P/Case-Shiller index. Consumer confidence rose to its highest levels in more than five years.

Markets were also pleased with the comments from the People’s Bank of China about that nation’s liquidity crunch.

S&P Capital IQ’s Alec Young noted today that concerns about rising interest rates in China and eventual tapering of the Federal Reserve’s bond buying program are the main culprits behind markets’ recent volatility, but thinks that stocks have been oversold: “[G]iven our view that the U.S. recovery can withstand the recent back-up in rates which we believe already discounts significant QE tapering, and that stronger growth will render any tapering manageable from an EPS perspective, we believe recent volatility is creating buying opportunities – primarily in more domestic, cyclical areas. And as for China, while we think growth will continue to slow as the economy shifts from fixed asset investment to domestic demand, we don’t see a credit crunch.”

Walgreen (WAG) was a notable exception to the rally; it was the worst performer in the S&P after falling on its third-quarter miss.

About Stocks To Watch

Earnings reports, corporate strategies and analyst insights are all part of what moves stocks, and they’re all covered by the Stocks to Watch blog. We also look at macro issues, investor sentiments and hidden trends that are affecting the market. Stocks to Watch gives you the full picture of the U.S. stock markets, all day long.

The blog is written by Ben Levisohn, a former stock trader who has covered financial markets for the Wall Street Journal, Bloomberg and BusinessWeek.